Sample Business Contracts

Section

1. PROVISION OF LOCAL SERVICE AND UNBUNDLED ELEMENTS

2. TERM OF AGREEMENT; TRANSITIONAL SUPPORT

3. GOOD FAITH PERFORMANCE

4. OPTION TO OBTAIN LOCAL SERVICES OR NETWORK ELEMENTS UNDER OTHER AGREEMENTS

5. RESPONSIBILITY OF EACH PARTY

6. GOVERNMENTAL COMPLIANCE

7. RESPONSIBILITY FOR ENVIRONMENTAL CONTAMINATION

8. REGULATORY MATTERS

9. LIABILITY AND INDEMNITY

10. AUDITS AND INSPECTIONS

11. PERFORMANCE STANDARDS AND REMEDIES

12. UNCOLLECTIBLE OR UNBILLABLE REVENUES

13. CUSTOMER CREDIT HISTORY

14. FORCE MAJEURE

15. CERTAIN STATE AND LOCAL TAXES

16. ALTERNATIVE DISPUTE RESOLUTION

17. NOTICES

18. CONFIDENTIALITY AND PROPRIETARY INFORMATION

19. BRANDING

20. MISCELLANEOUS

Attachment 1

Definitions

Attachment 2

Acronyms

Attachment 3

Alternative Dispute Resolution

Attachment 4

Directory Listing Requirements

Attachment 5

Local Services Resale

Attachment 6

Specifications, Service Descriptions and Implementation Schedule for Unbundled Network Elements

Attachment 7

Rights of Way, Conduits, Pole Attachments

Attachment 8

Pricing

Attachment 9

Access to VeriGate, LEX and POS Operations Support Systems

Attachment 10

Collocation

Attachment 11

Provisioning and Ordering

Attachment 12

Maintenance

Attachment 13

Connectivity Billing and Recording

Attachment 14

Provision of Customer Usage Data

Attachment 15

Local Number Portability and Number Assignment

Attachment 16

Security

Attachment 17

Service Performance Measures and Related Remedies

Attachment 18

Interconnection

This Agreement shall expire on August 6, 2001, and thereafter the Agreement shall continue in force and effect unless and until a new agreement, addressing all of the terms of this Agreement, becomes effective between the Parties. The Parties agree to commence negotiations on a new agreement no less than six (6) months before August 6, 2001. In the event that such new terms are not renegotiated

within such six (6) month period, either Party may submit the matter to the Alternative Dispute Resolution Process described in Attachment 3. NEVADA recognizes that the Network Elements, Ancillary Functions, Combinations, Local Services and other services provided hereunder are vital to CLEC and must be continued without interruption, and that CLEC may itself provide or retain another vendor to provide such comparable Network Elements, Ancillary Functions, Combinations, Local Services or other services. NEVADA and CLEC agree to cooperate in an orderly and efficient transition to CLEC or another vendor. NEVADA and CLEC further agree to cooperate in effecting the orderly transition to CLEC or another vendor such that the level and quality of the Network Elements, Ancillary Functions, Combinations, Local Services, and other services are not degraded and to exercise their best efforts to effect an orderly and efficient transition. CLEC shall be responsible for coordinating such transition.

In the event that any final and nonappealable legislative, regulatory, judicial or other legal action renders this Agreement or any Attachment

hereto inoperable, materially affects any material terms of this Agreement, or materially affects the ability of CLEC or NEVADA to perform any material terms of this Agreement, CLEC or NEVADA may, on thirty (30) days written notice (delivered not later than thirty (30) days following the date on which such action has become legally binding and has otherwise become final and nonappealable) require that such terms be renegotiated, and the Parties shall renegotiate in good faith such mutually acceptable new terms as may be required. In the event that such new terms are not renegotiated within ninety (90) days after such notice, the dispute shall be referred to the Alternative Dispute Resolution procedures set forth in Section 16 and Attachment 3.

No Consequential Damages - NEITHER CLEC NOR NEVADA SHALL BE LIABLE TO THE OTHER PARTY FOR ANY INDIRECT, INCIDENTAL, CONSEQUENTIAL, RELIANCE, OR SPECIAL DAMAGES SUFFERED BY SUCH OTHER PARTY (INCLUDING WITHOUT LIMITATION DAMAGES FOR HARM TO BUSINESS, LOST REVENUES, LOST SAVINGS, OR LOST PROFITS SUFFERED BY SUCH OTHER PARTY), REGARDLESS OF THE FORM OF ACTION, WHETHER IN CONTRACT, WARRANTY, STRICT LIABILITY, OR TORT, INCLUDING WITHOUT LIMITATION NEGLIGENCE OF ANY KIND WHETHER ACTIVE OR PASSIVE, AND REGARDLESS OF WHETHER THE PARTIES KNEW OF THE POSSIBILITY THAT SUCH DAMAGES COULD RESULT. EACH PARTY HEREBY RELEASES THE OTHER PARTY (AND SUCH OTHER PARTY’S SUBSIDIARIES AND AFFILIATES, AND THEIR RESPECTIVE OFFICERS, DIRECTORS, EMPLOYEES AND AGENTS) FROM ANY SUCH CLAIM. NOTHING CONTAINED IN THIS SECTION 9 SHALL LIMIT NEVADA’S OR CLEC’S LIABILITY TO THE OTHER FOR (i) WILLFUL OR INTENTIONAL MISCONDUCT (INCLUDING GROSS NEGLIGENCE); (ii) BODILY INJURY, DEATH OR DAMAGE TO TANGIBLE REAL OR TANGIBLE PERSONAL PROPERTY PROXIMATELY CAUSED BY NEVADA’S OR CLEC’S NEGLIGENT ACT OR OMISSION OR THAT OF THEIR RESPECTIVE AGENTS,

SUBCONTRACTORS OR EMPLOYEES, NOR SHALL ANYTHING CONTAINED IN THIS SECTION 9 LIMIT THE PARTIES’ INDEMNIFICATION OBLIGATIONS, AS SPECIFIED BELOW.

Obligation to Defend; Notice; Co-operation - Whenever a Claim shall arise for indemnification under Section 9.4, the relevant Indemnitee, as appropriate, shall promptly notify the Indemnifying Party and request the Indemnifying Party to defend the same. Failure to so notify the Indemnifying Party shall not relieve the Indemnifying Party of any liability that the Indemnifying Party might have, except to the extent that such failure prejudices the Indemnifying Party’s ability to defend such Claim. The Indemnifying Party shall have the right to defend against such liability or assertion in which event the Indemnifying Party shall give written notice to the Indemnitee of acceptance of the defense of such Claim and the identify of counsel selected by the Indemnifying Party. Except as set forth below, such notice to the relevant Indemnitee shall give the Indemnifying Party full authority to defend, adjust, compromise or settle such Claim with respect to which such notice shall have been given, except to the extent that any compromise or settlement shall prejudice the Intellectual Property Rights of the relevant Indemnitees. The Indemnifying Party shall consult with the relevant Indemnitee prior to any compromise or settlement that would affect the Intellectual Property Rights or other rights of any

Indemnitee, and the relevant Indemnitee shall have the right to refuse such compromise or settlement and, at the refusing Party’s or refusing Parties’ cost, to take over such defense, provided that in such event the Indemnifying Party shall not be responsible for, nor shall it be obligated to indemnify the relevant Indemnitee against, any cost or liability in excess of such refused compromise or settlement. With respect to any defense accepted by the Indemnifying Party, the relevant Indemnitee shall be entitled to participate with the Indemnifying Party in such defense if the Claim requests equitable relief or other relief that could affect the rights of the Indemnitee and also shall be entitled to employ separate counsel for such defense at such Indemnitee’s expense. In the event the Indemnifying Party does not accept the defense of any indemnified Claim as provided above, the relevant Indemnitee shall have the right to employ counsel for such defense at the expense of the Indemnifying Party. Each Party agrees to cooperate and to cause its employees and agents to cooperate with the other Party in the defense of any such Claim and the relevant records of each Party shall be available to the other Party with respect to any such defense.

Subject to NEVADA’s reasonable security requirements, CLEC shall have the audit rights specified in this subsection 10.9 in addition to the financial audit rights provided above. CLEC may inspect once, in each Contract Year, NEVADA’s books, records, and other documents relevant to (a) any one or more of the Network Elements, Ancillary Functions, Combinations, Local Services, or other services provided to CLEC for the purpose of

evaluating NEVADA’s compliance with the terms and conditions of this Agreement; (b) NEVADA’s compliance with Attachment 17 and (c) NEVADA’s compliance with Attachment 18. Should any such audit show that NEVADA is materially out of compliance with its obligations under this Agreement, CLEC may conduct additional audits in each Contract Year, provided that CLEC may not audit NEVADA under this Section 10.9 more than one time in any ninety (90) day period. CLEC employees may conduct audits pursuant to this Section 10.9, unless NEVADA reasonably maintains that the books, records and other documents relating to CLEC are impossible or impractical to segregate from documents containing proprietary information of other parties, in which case, the audit shall be conducted by a mutually designated third Party auditor, with the expense shared equally by the Parties, provided, however, that (a) if the auditor finds that NEVADA has complied with the Act or this Agreement, CLEC shall pay for the audit; and (b) if the auditor finds that NEVADA has not complied with the Act or this Agreement, NEVADA shall pay for the audit.

The Recipient may make copies of Confidential Information only as reasonably necessary to perform its obligations under this Agreement. All

such copies shall bear the same copyright and proprietary rights notices as are contained on the original.

Each Party agrees that the Discloser would be irreparably injured by a breach of this Agreement by the Recipient or its representatives and that the Discloser shall be entitled to seek equitable relief, including injunctive relief and specific performance, in the event of any breach of the

provisions of this Agreement. Such remedies shall not be deemed to be the exclusive remedies for a breach of this Agreement, but shall be in addition to all other remedies available at law or in equity.

No Third-Party Beneficiaries - Except as may be specifically set forth in this Agreement, this Agreement does not provide and shall not be

construed to provide third parties with any remedy, claim, liability, reimbursement, cause of action, or other privilege.

Severability - If any term, condition or provision of this Agreement is held to be invalid or unenforceable for any reason, such invalidity or unenforceability shall not invalidate the entire Agreement, unless such construction would be unreasonable. The Agreement shall be construed

as if it did not contain the invalid or unenforceable provision or provisions, and the rights and obligations of each Party shall be construed and enforced accordingly; provided, however, that in the event such invalid or unenforceable provision or provisions are essential elements of this Agreement and substantially impair the rights or obligations of either Party, the Parties shall promptly negotiate a replacement provision or provisions.

*NEVADA BELL

BY SBC TELECOMMUNICATIONS, INC.,

ITS AUTHORIZED AGENT

/s/ Sandy Kinney

/s/ David S. Trandal

Sandy Kinney

President-Industry Markets

May 24, 1999

David S. Trandal

President-Liberty Telecom LLC

May 14, 1999

WHEREAS, by executing this MFN Agreement providing certain rates, terms and conditions, Nevada Bell reserves all appellate rights with respect to such rates, terms and conditions and does not waive any legal arguments by executing this Agreement. It is Nevada Bell’s intent and understanding of state and federal law, that any negotiations, appeal, stay, injunction or similar proceeding which impacts the applicability of such rates, terms or conditions to the underlying Agreement will similarly and simultaneously impact the applicability of such rates, terms and conditions to CLEC. In the event that any of the rates, terms and/or conditions herein, or any of the laws or regulations that were the basis for a provision of the Agreement, are invalidated, modified or stayed by any action of any state or federal regulatory bodies or courts of competent jurisdiction, including but not limited to any decision by the Eighth Circuit relating to any of the costing/pricing rules adopted by the FCC in its First Report and Order, In re: Implementation of the Local Competition Provisions of the Local Competition Provisions in the Telecommunications Act of 1996, 11 FCC Rcd 15499 (1996), (e.g., Section 51.501, et seq.), upon review

Supreme Court, in AT&T Corp. v. Iowa Utilities Bd., 1999 WL 24568 (U.S.), (“such Actions”), Nevada Bell believes the Parties should immediately incorporate changes from the underlying Agreement, made as a result of such Actions into this Agreement. Where revised language is not immediately available, Nevada Bell believes the Parties should expend diligent efforts to incorporate the results of such Actions into this Agreement on an interim basis, but should conform this Agreement to the underlying Agreement, once such changes are filed with the Commission.